The London Stock Exchange has been targeted by a £31.6billion takeover swoop by its Hong Kong rival.

Hong Kong Exchanges and Clearing (HKEX) said it has proposed a cash-and-shares deal which would see it pay around £8.36 a share for LSE Group. This values it at £29.6 billion, or £31.6 billion including debt.

The bidder said a merger of the two companies would create a ‘global market infrastructure leader’.

A trading screen at the London Stock Exchange in June after it was opened by Philip Hammond

Signage is pictured outside the entrance to the London Stock Exchange in August last year

HKEX added: ‘The proposed combination would strengthen both businesses, better position them to innovate across markets and geographies, and offer market participants and investors unprecedented global market connectivity.’

Shares in the London Stock Exchange Group surged 10 per cent after the approach was revealed.